Debt Ceiling Fight:

[TampaYankee]

Debt Ceiling Fight: Democrats See Republicans In 'Blazing Saddles' Strategy

Michael McAuliff

mike.mcauliff@huffingtonpost.com

WASHINGTON -- Are Republicans following a Blazing Saddles strategy in the looming standoff over the nations debt limit?

Imagine the scene in the Mel Brooks classic, where Cleavon Little points a gun at his own head and threatens to shoot if the armed townspeople dont drop their weapons.

Listen to him, men. He's just crazy enough to do it! one says.

Thats how some Democrats view GOP demands for really, really big concessions on spending and deficits in return for raising Americas debt ceiling. They think Republicans are essentially threatening to take a step that would spark an economic catastrophe -- and that the public would blame the GOP for it.

It reminds me of the joke where the guy comes home and finds his wife in bed with another guy, puts the gun to his head and his wife starts laughing, Rep. Gary Ackerman (D-N.Y.) told the Huffington Post. He says Who are you laughing at? Youre next!

The next hostage event seems to be the debt limit, House Minority Whip Rep. Steny Hoyer (D-Md.) said.

The only reason you can hold hostage something is because the other side wants to act responsible, he added. Therefore you think, even though they don't want what you're pressing, that [Democrats will] take it to prevent a bigger harm. I think that's irresponsible."

Even some Republicans privately wonder how the leadership can plausibly threaten a move that could pull the plug on the economy while arguing they want to fix the economy.

Thats a damn good question, one GOP Financial Services aide acknowledged. Even the Ryan budget requires raising the debt ceiling, the staffer said, referring to the Republicans 2012 budget plan offered last week by Rep. Paul Ryan (R-Wis.)

Its Alice in Wonderland territory, the aide said.

To recap, the U.S. debt ceiling is the maximum amount set by Congress that the country can borrow to meet its obligations. Now standing at $14.3 trillion, Treasury Secretary Tim Geithner warns the nation will hit it in mid-May. The Treasury can juggle the books for several weeks after that to pay the bills, but America will default for the first time since dropping the gold standard if the limit is not raised by early July.

Economists have warned defaulting would spark economic calamity, beginning with spiking interest rates on bonds and potentially ending with a new, worse recession.

Yes, the Republicans are threatening to wreck the U.S. economy unless they get their way, said Rep. Carolyn Maloney (D-N.Y.), who chaired the Joint Economic Committee before the GOP won the last election.

The reason the GOP stance seems like a bad joke to many Democrats is that Congress can't avoid raising the debt limit, whatever anyone says. The math just wont allow it.

It's all but impossible to cut enough from the budget to avoid smacking into the limit, which last week was only about $80 billion away, a fact that many people have overlooked..

According to the Congressional Research Service, the nation needs to raise its debt limit by $738 billion just to finish 2011 -- and there is only about $688 billion in discretionary spending left for the second half of the year. Cutting that spending would only delay the need to hike the debt, because there is, after all, an awful lot of interest to pay.

Rep. Barney Frank (D-Mass.), the top Democrat on the Financial Services Committee, noted that the debt involves money that was already spent: on wars, an unfunded Medicare drug program and tax cuts, for instance, which he pointed out he didn't support.

The way you deal with debt is by not incurring it, Frank told HuffPost. The notion that you can incur it and then ignore it is stupid.

Yet Majority Leader Eric Cantor (R-Va.) has vowed to use the debt ceiling as a " leverage moment," and declared Tuesday, Were only talking about even doing this [raising the debt limit] if we can be assured there are guarantees in place that the spending doesnt get out of control here.

Maybe theyve got an imaginary magic leverage stick, quipped Ackerman, a senior member of the Financial Services Committee.

Thinking along fairy tale lines, Frank argued that House Speaker John Boehner (R-Ohio) and Senate Minority Leader Mitch McConnell (R-Ky.) know what has to be done. But he said they could have a hard time doing it because of both the new Tea Party members in their base and fears of primary challenges from the Tea Party.

Nobody knows just how far removed from reality these people are, Frank said. If we were dealing with just John Boehner and Mitch McConnell, it would be one thing. When youre dealing with John Boehner, Mitch McConnell, the White Rabbit and the Mad Hatter, its unpredictable."

This is not Samuel Adams Tea Party; this is Lewis Carrolls Tea Party were dealing with here, Frank said.

And that gives Democrats pause, Ackerman said, leaving him feeling a little like Cleavon Littles townspeople.

The problem is they might just go ahead and do it, Ackerman said.

In a political world in which [Minnesota Republican Rep.] Michele Bachmann is a serious person, then not raising the debt limit becomes a serious threat, said Frank.

Ackerman and Frank, though, think maybe its time to call the bluff, rather than have Democrats give the GOP concessions as they did on this year's budget and last winter's tax cuts.

Theyre in charge, which means theyre supposed to be the grown-ups this year, said Ackerman, admitting, as Frank did, that the minority party generally opposes the debt limit. But their strategy of 'lets hold our breath until our face turns blue' is not a good strategy. I think the American people will blame them.

Refuse to pay any attention to the threat, Frank advised his colleagues and the White House. And make no concessions.

I think its clear theyd pay a very high price for this, Frank added.

Nevertheless, reports from 1600 Pennsylvania Avenue Tuesday suggested President Obama might throw the GOP at least several bones in his fiscal responsibility speech set for Wednesday -- a prospect frowned upon by Ackerman.

For my taste, Id like to see a stronger executive branch where theyre really helping direct things rather than standing by just watching them, he said.

See original article at:

http://www.huffingtonpost.com/2011/04/12/democrats-republicans-debt-ceiling-fight_n_848369.html

[TampaYankee]

Here is an instance where Obama and the Dems have all of the leverage. If the GOP shoots down the Debt Ceiling extension the effects would devastate them for years. The choice is throw a political tantrum and cause world-wide economic, and worse, national armageddon or pass the extension and sit down to some serious negotiation about long term spending and tax policy.

If I were Obama I would demand a clean extension bill with a committment to begin immediately serious disucssion about the longterm issues, with a renewed proposal to have the Deficit Commission with straight up or down vote that the GOP shot down last time after having proposed it.

An intelligent economic restructing is not going to happen in a few weeks or a few months with a gun to our heads, expecially with the stunts and wackos pushing for impossible remedies. This is not the way to solve a serious problem short of taking a meat ax to our limbs. Some want that, but it won't happen and shouldn't happen. For the Dems to even particpate in a platform for that type of discussion adds to the circus environment.

Here is an instance where Obama and the Dems have all of the leverage. Let's see how badly they screw it up. You know they will.

[MsGuy]

So the Repubs are threatening to wreck the economy in a partisan party factional in-fight and the Dems are threatening to sit back and let them do it for their own long term partisan political benefit?

So I spent an hour this morning listening to my populist brother rant that the Republic is dead and that all this crap in D.C. is a dog and pony show put on by our behind the scenes masters. Watch the hands, he says, and pay no attention to the magician's patter.

I can't buy my brother's paranoid notions (he has this intense intellectual need to believe that somehow there's a guiding purpose behind Washington's antics). But I can acknowledge that our old Republic may be reaching the end of its run. Oh well, it was a fluke of history from the git go and we did some really neat stuff along the way.

[lookin]

Your brother may be closer to the mark than you think. This NYT article explains how GE earned $14.2 billion in profits last year, and got a U.S. tax refund of $3.2 billion.

Hint: Former Treasury Department official John Samuels heads up their 975 person tax department.

[TampaYankee]

So the Repubs are threatening to wreck the economy in a partisan party factional in-fight and the Dems are threatening to sit back and let them do it for their own long term partisan political benefit?

Do you really believe there are 218 votes in the House and 41 votes in the Senate willing to see the dountry default? I don't.

To default would mark the end of America as an economic superpower. We would have declared ourselves as just another banana republic by defaulting. No longer would anyone look to us as a the international entity of stability. The dollar would be abandoned as any sort of international currency. International investments would be great diminished with much higher profit and interest rates demanded of banana republic investments.

Many might think we could just undo the impact after getting our house in order. Sort of like tell everyone "we was just funnin'" or "it was only a tantrum, nothing serious". Yeah. Confidence is easily shaken and slow to be regained, especially after such a grand tempermental failure.

A default would accrue to no one's benefit. However, the GOP would take the big hit because they would be the one causing the default. The argument that 'The Dems made us do' it would get little traction outside of the school yard GOP play area.

That is not to say that Dems would not suffer as all Congressional politicians would be lumped together as ineffective and corrupt.

However, the Dems cannot accept governance with a gun held to their head. IMO, this is not an issue that lends itself to an open legislative process. History tells us that there are too many special interests with too much influence affecting both sides for an open give and take process to achieve a rational end result. These kinds of issues with intense partisan feelings have been addressed in the last fifty years behind closed doors with all parties represented by trusted people. A compromise proposal emerges which pleases no one but addresses the issues and meets some of each sides requirements. The package is submitteed for an up or down vote. This his how military bases are closed. This is how Social Security solvency was addressed in the 80s. This is how this question will be resloved, not with a gun to one side's head.

If we don't have a Congress with enough since to protect and defend the Constitution and the Country then maybe we have come to the end of the line. I doubt it though.

[Guest hitoallusa]

I hope Obama can achieve something in his presidency. Please bring the real change he promised. Go Obama~~~. BTW I have to agree with MsGuy's brother and Lookin.

[lookin]

GE's tax machinations were the subject of a hoax today when the Associated Press fell hook, line and sinker for a story that GE was going to give back the $3.2 billion refund they received on their 2010 taxes.

The fake press release was issued by a group called US Uncut (not associated with MER's Pornification Forum) and supported by another group known as The Yes Men. GE acted quickly to disabuse everyone of the notion that they were planning to give anything back, and a retraction was issued within the hour.

We can all rest easy tonight knowing that, if we do end up providing any kind of economic safety net to U. S. citizens, it won't be coming out of GE's corporate coffers.

By the way, did you know that U. S. corporations covered 30% of all federal revenue in the 1950's but, in 2009, covered only 6.6%? Of course, corporate panties are still bunched in the nation's boardrooms, as they squeal it's still far too much. Wonder how low they're fixin' to go?

[TampaYankee]

By the way, did you know that U. S. corporations covered 30% of all federal revenue in the 1950's but, in 2009, covered only 6.6%? Of course, corporate panties are still bunched in the nation's boardrooms, as they squeal it's still far too much. Wonder how low they're fixin' to go?

lookin'

You often have a unique way of driving home a point. BTW, what was your point here or were you just teasing bibottomboy?

<Gee, where can you find an icon for 'Caution, Pussy Crossing' when you need one.>

[lookin]

You caught me with my pants down, TY. I was in a rush and snatched the first limbo pic I saw.

I do hope it will act as catnip for BBB.

[Guest zipperzone]

You caught me with my pants down, TY. I was in a rush and snatched the first limbo pic I saw.

I do hope it will act as catnip for BBB.

I don't know about the rest of you but personally - it almost made me puke

[BiBottomBoy]

It is sort of shocking to see pussy here!

I don't think the GOP is insane enough to refuse to lift the debt ceiling. The good news about all of this is that the GOP leaders may be starting to realize that aligning themselves with the Tea Party was a really bad idea.